Boris Johnson’s government has been in power for 2 weeks now.  What more do we know about his priorities and approach and what that means for business?

What are his priorities?

The new Prime Minister has brought clarity and focus to government with a clear set of immediate priorities:

  • Brexit: leaving the EU on 31 October. And ramping up no-deal preparation
  • Increase spending in public services that most matter to voters: education, police and health
  • Support development in 'left behind towns': a £3.6 billion Towns Fund for 100 towns and establishing new 'free ports'.

These priorities are focused on the short term: leaving the EU and winning an election. What they don’t cover - and what we (and government officials) are none the wiser on is what Boris Johnson’s long-term policy goals might be: what sort of post-Brexit Britain would he seek to create?

How is the government organised?

Another way of looking at this is to think of Boris Johnson's government effectively having two or three teams within it focused on different timescales: 

  • Brexit on 31 October by any means necessary: driven by Michael Gove as head of no-deal planning, Dominic Raab in the foreign office and the Number 10 team (inc. Dominic Cummings) from the former Vote Leave campaign.
  • Election campaign prep:  the Vote Leave team (as above) and initial focus of announcements on police, schools, NHS, social care and northern towns.
  • Post Brexit policies: there are divergent ideologies within the government on this: if Dominic Cummings stays on then he has a vision for reforming public services and potentially an interventionist and anti-corporate agenda. Elsewhere there is a strong strand of libertarianism and “Reagan-omics” focused on a low tax, deregulatory agenda (eg Dominic Raab, Liz Truss and Priti Patel).  And there are also some ‘One Nation’ Tories around Johnson who would favour more of a balance between market economy and government intervention. We do not know which of these would come to the fore…

What happens next?

The autumn and winter will see the greatest political turbulence in the UK for at least 40 years. Political parties will be divided. Political debate will be polarised and angry.  

We are likely to have an election; possibly as soon as October. The outcome is unpredictable.

Between now and Christmas politics will be about just one issue: Brexit. 

The Chancellor will unveil a Brexit Budget in September or early October; expect tax cuts, increased spending and actions to help ease the impact of a no-deal exit.

No-deal Brexit on 31 October is now the most likely outcome.  The months after a no-deal will be preoccupied with managing emergencies and restoring stability to the economy and society.

‘Post-Brexit’ issues will eventually rise up the agenda in 2020: with a clearer direction of travel for tax, regulation, trade and spending and specific issues such as social care, housing and local economic development.

What does this mean for Brexit planning?

No-deal Brexit is now the most likely outcome on 31 October: 

·        Both sides have dug in: Boris Johnson is refusing to engage with EU leaders unless they abandon the Irish backstop; EU leaders have made clear they will not do so and are increasingly resigned to no-deal. 

·        Boris Johnson has made crystal clear that the UK will leave on 31 October and has little wriggle room to U-turn. 

·        There is a slim chance of MPs stopping no-deal:  the opposition are too divided and not aligned around a single strategy, they will have little time to do anything and a determined Prime Minister can do much to deflect Parliament.  

No-deal on 31 October must be the planning assumption for all organisations.  

What should businesses do?

There is already little time left for business to prepare for no-deal on 31 October: now less than 85 days away.  

Up to two-thirds of the mid-sized businesses I talk to at seminars don’t yet have a plan for Brexit. But a third do – which means that every business without a plan has at least one competitor who is much better prepared for Brexit. Don’t delay! 

For manufacturers, retailers and anyone dependent upon just-in-time delivery, the top priority for the next few weeks should decide how best to mitigate the logistics disruption we can expect from November through to the new year. My colleague Olly has some tips here. And if you are an exporter, go through HMRC’s Brexit readiness checklist and make any applications. 

My Brexit essentials guide provides more advice:   And here are few more thoughts on what to do this month:

For those who are prepared for Brexit, some of our clients are now turning their attention to thinking about an election and how different outcomes may affect the business environment. Increasingly I am working with clients to run political scenario planning around the next election. 

Political turbulence, Brexit and an election: looking ahead to the autumn we may get ten years’ worth of politics in ten weeks.